ECON 1012 Lecture Notes - Lecture 10: Fiat Money, Deposit Account, United States Treasury Security
Document Summary
Section 3 (material drawn from lectures and chapters 7 & 8 parkin) Money: money is defined as any commodity or token that is generally acceptable as a means of payment. Fiat money: value not connected to its non-monetary use. Expectation of acceptance by others: money serves the following functions: A medium of exchange is any object that is generally accepted in exchange for goods and services. Barter: an exchange in which goods and services are exchanged directly for other goods and services (without a medium of exchange) A double coincidence of wants is the situation where the supplier of good a wants good b and the supplier of good b wants good a. Currency: notes and coins held by individuals and businesses. Deposits at banks and other depository institutions: official measures of money: 2 official measures. M1: consists of currency and travelers" checks plus checking deposits owned by individuals and businesses.
